Case Title: M/s.Shewil Trading Company Versus The Commissioner of Commercial Taxes
Case No: W.P.No.26493 of 2022 and W.M.P.Nos.25555 & 25556 of 2022
Decided on: 02 November, 2023
CORAM: HON’BLE MR. JUSTICE C. SARAVANAN
Introduction
The Madras High Court while hearing a plea by petitioner according to who a copy of the assessment order was not provided when the impugned notice for recovery of Rs. 11,63,24,233/-was sent out mandates the department to probe into the misappropriation of the login ID by an unidentified person, potentially enabling tax evasion.
Facts of the Case
In the present case, the petitioner has been in the outward supply of curtains, foam mattresses, and pillows for almost 28 years and used to submit returns for the Assessment Year 2009–2010 both manually under the old TNGST Act, 1959, and electronically under the TNVAT Act, 2006. Up until December 2013, the petitioner consistently submitted electronic returns in compliance with TNVAT Rules, 2007. But as of January 2014, the petitioner was having trouble logging in and couldn’t submit returns electronically. The problem remained in spite of numerous attempts to bring it up with the second respondent. In addition, on December 22, 2014, the petitioner received a notice, to which a response was filed on February 6, 2014. The petitioner received letters from the second respondent on July 24, 2015, advising them to update their password.
The petitioner simultaneously filed a complaint with the Cyber Crime Cell, Central Crime Branch, Veppery, on August 31, 2015, and approached the second respondent with a complaint on September 18, 2015. As a result, the petitioner’s login ID and password were allegedly misused, as evidenced by the filing of a formal complaint (Crime No. 100 of 2017) on April 6, 2017. As the basis for their plea, the petitioner claimed that someone had made significant transactions using their TIN number.
According to the respondent, the contested recovery notification is not warranted for challenge. A notice was published earlier than the assessment order, which was received by the petitioner on November 9, 2021. Nevertheless, it is asserted.
Courts analysis and decision
Accordingly, the court mandated that the Commercial Tax Department work with the other respondents to investigate the petitioner’s allegation. After receiving a copy of the order, this investigation must be completed within 18 months. All revenue recovery proceedings against the petitioner shall be temporarily halted throughout the investigation period. The petitioner’s belongings may be sold if it turns out that the complaint was made in error or that its purpose was to enable fraudulent activity using the petitioner’s login ID.
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Written by- Rupika Goundla
